**Maharashtra Entertainment Duty on Online Ticket Booking Fees Upheld by Bombay High Court**
The Bombay High Court has affirmed the Maharashtra government’s authority to impose entertainment duty on convenience fees associated with online movie ticket bookings. This decision was made on Thursday, following the dismissal of two petitions from the FICCI-Multiplex Association of India and the online ticketing service BookMyShow.
A bench comprising Justices MS Sonak and Jitendra Jain stated that the convenience fee for online ticket purchases is intrinsically linked to accessing entertainment. The court emphasized that these online booking charges are essential for obtaining entry to theaters, rendering any distinction between services provided inside and outside the entertainment venue as “superfluous.”
The case centered on a 2014 amendment to the Maharashtra Entertainments Duty Act (MED Act), which permits the state to levy entertainment duty on convenience fees exceeding Rs 10 per ticket. The petitioners contended that this fee pertains to a separate service—online booking—on which service tax is already being paid under the Central Finance Act. They argued that the state lacks the authority to tax this fee, as it is not directly related to the actual screening of films.
Senior advocate Naresh Thacker, representing the Multiplex Association, argued that there is “no direct nexus” between the convenience fee and entry to entertainment, labeling the tax as unconstitutional and beyond the state’s constitutional powers. He maintained that the online ticket sales represent a distinct business activity from the actual film exhibition in theaters.
In a separate petition, BookMyShow described itself as “merely a service provider” and not the organizer of entertainment. The platform criticized the government’s move as a “colourable exercise of power,” asserting that the true intent was consumer protection rather than taxation.
The Maharashtra government, represented by Additional Government Pleader Milind More, defended the amendment, asserting that the convenience fee is part of the overall cost of watching a movie and thus subject to taxation. He noted that the 2014 amendment aimed to curb excessive booking charges.
The court sided with the state, affirming that the power to impose entertainment tax resides with the state legislature. It dismissed the argument that the convenience fee is unrelated to entertainment, stating that the service is integral to the process of gaining entry to a show.
Notably, just last month, the same bench had invalidated two earlier state government orders from 2013 and 2014 that prohibited cinema owners from charging convenience fees for online ticket bookings. With this ruling, while cinema owners and ticketing platforms can continue to charge convenience fees, any amount exceeding Rs 10 per ticket will incur entertainment duty.
**FAQ**
**Q: What is the significance of the Bombay High Court’s ruling on entertainment duty?**
A: The ruling confirms the Maharashtra government’s right to tax convenience fees on online movie ticket bookings, linking these fees directly to access to entertainment, thereby impacting how ticketing platforms and cinema owners operate.
